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Tassie forests war set to go on

David Beniuk

An end to the decades-long conflict over Tasmania's forests looks as remote as ever with the talks that came closest to delivering peace finally collapsing.

Federal Environment Minister Tony Burke said he would begin unwinding an agreement between the Commonwealth and state governments that would have delivered $100 million if a deal had been reached between environmentalists and the forestry industry.

More than two years of talks, which in August delivered an interim agreement, have come to nothing with green group demands for about 520,000 hectares of new reserves unable to be reconciled with the industry's wood supply needs.

Mr Burke and Tasmanian Forestry Minister Bryan Green emerged from the final stages of negotiations expressing "pessimism", while environmental groups blamed the Forest Industries Association of Tasmania (FIAT) and the state's sawmillers.

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"Negotiations responding to the crisis in the native forest logging industry today collapsed due to the unwillingness of the Forest Industries Association of Tasmania and the old growth sawmilling sector to move itself onto a sustainable footing and no longer log World Heritage-verified forests," a joint statement from the Wilderness Society, Australian Conservation Foundation and Environment Tasmania said.

FIAT boss Terry Edwards said he was trying not to play the blame game, but couldn't resist a swipe back.

"It would be very easy to blame them and say that their reserves claim of over half a million hectares was excessive," Mr Edwards told AAP.

"Many people will believe that to be the case, but I don't think anything's gained by going down that path."

The fact the two groups even ended up in a room together after a conflict that goes back to the Lake Pedder campaign of the 1970s is considered by some an achievement in itself.

The talks stumbled several times as various groups withdrew and then returned, while deadlines came and went.

In the end, Mr Burke said, a "wonderful" opportunity had been missed.

"I look around the table and I look at each party and I cannot see an upside for any of them in the pessimism that we're now feeling," he said.

"Now people have to look down the barrel of what is it like without an agreement."

That could mean little federal money to transition the industry out of native forests, while it is unclear what the state government's next move will be.

Greens leader Christine Milne called on Prime Minister Julia Gillard to intervene to ensure World Heritage listing of forests and the federal money.

The Liberal state opposition, which has promised to rip up the intergovernmental agreement, said Premier Lara Giddings should call an election.

Environmental groups immediately signalled they would step up their campaigns, some in the overseas markets for Tasmanian timber products.

Mr Edwards said the funding would have only amounted to $7 million a year, but its absence would still hurt.

"There's going to be collateral damage from this failure to reach an agreement," he said.

"That's going to hurt many innocent Tasmanians, their families who rely on them for food on the table and the regional communities."